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The Aaron Hernandez Case From a Business Perspective

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Former tight end for the New England Patriots, Aaron Hernandez, has been charged with first-degree murder and five gun related counts after the body of Odin Lloyd was found about a mile from Hernandez's house. Hernandez had pled not guilty, and will be held without bail. Shortly after his arrest the Patriots released Hernandez from the team. With all of that being said, what does this mean for the Patriots, the NFL, and Hernandez from a business perspective? It is pertinent to know the timeline of events leading up to the arrest and dismissal of Hernandez before going further and the actual charges against him.

June 17: the body of Odin Lloyd was found about a mile from Hernandez’s house.

June 18: police searched the Hernandez house.

June 20: police learn of a destroyed home security system and cell phone belonging to Hernandez.

June 21: police reportedly prepare the arrest warrant for Hernandez on obstruction of justice.

June 22: police search the Hernandez house again and remove about 15 bags of evidence.

June 24: police search a pond near the Hernandez house.

June 26: Hernandez is arrested and released by the New England Patriots.

The official charges against Hernandez are murder in the first degree, carrying a firearm without a license, two counts of possession of a large-capacity firearm, and two counts of possession of a firearm without a firearm owners identification card.

When Hernandez was arrested on June 26, he was without a shirt on. This might seem trivial but it says a lot about the case. Number one, his lawyer didn’t know an arrest was coming so soon, otherwise he would have been at the house to make sure his client was taken into custody in a more private matter. What’s more interesting than the lawyer not being present, is the fact that Hernandez wasn’t dressed to impress at all. Knowing that after an arrest he would be going straight to court to have a pre-trial hearing, Hernandez would most likely want to be dressed in a way that seemed more professional.

The defense strategy is going to be to give an alternative narrative to what happened the night Lloyd was killed. The prosecution claims that the murder was “execution style.” The Bristol County District Attorney, C. Samuel Sutter has told the media that it is in the best interest of the case not to comment on anything, but anyone who has information is to contact the proper authorities.

Because the case is so high profile and anyone who watches professional sport knows about this case, it will most likely not have a new venue outside of Bristol County.

There hasn’t been any announcement of if they do or do not have a murder weapon or a witness in court. Though, shell casings that were found in the rental car Hernandez was driving that night match the shell casings found at the scene of the crime.

Along with the shell casings as a piece of evidence, the destroying of Hernandez’s home surveillance system and cell phone raise a lot of implications that he has something to hide. Police have said even though the cell phone was ruined, they were able to get some information from it.

Let’s say that Hernandez is found guilty, what will be his jail time? This depends on the type of murder he is charged with in the end. There is no death penalty in the state of Massachusetts. If, in fact Hernandez is charged with first-degree murder after the trial he could get life in prison with no possibility of parole. If he is charged with second-degree murder then depending on the evidence will determine the amount of time he will spend in jail.

From a public relations standpoint this is going to take a lot of work to bring the Patriots and the NFL back into a good standing with fans and sponsors. The Patriots and the NFL both made a statement regarding the case. Both statements are very well written and hit on all major points that have been presented so far. The statements include something about the loss of Lloyd, Hernandez’s actions, and this is not to be a reflection of the team or league.

This is what the Patriots had to say:

A young man was murdered last week and we extend our sympathies to the family and friends who mourn his loss. Words cannot express the disappointment we feel knowing that one of our players was arrested as a result of this investigation. We realize that law enforcement investigations into this matter are ongoing. We support their efforts and respect the process. At this time, we believe this transaction is simply the right thing to do.”

This statement brings in not only fans of the Patriots but fans of the league, and people who are keeping up with this case. The Patriots were very smart in the timing of this statement as well. If a statement is made to early, and things didn’t unfold like they did the past few days, the Patriots would have looked extremely dumb. There is a very high chance that the police have been talking to the owners, managers and coaching staff of the team to keep them up to date and see if they know anything about the case as well. The team had nine days and a ton of information to process, but most likely made the decision to cut Hernandez before the actual arrest.

The NFL’s statement was very similar:

“The involvement of an NFL player in a case of this nature is deeply troubling. The Patriots have released Aaron Hernandez, who will have his day in court. At the same time, we should not forget the young man who was the victim in this case and take this opportunity to extend our deepest sympathy to Odin Lloyd’s family and friends.”

The statement from the NFL is much more generic than the one from the Patriots, but it still brings the same message. This type of statement layout has been used before with other cases involving players, including Ray Lewis, Justin Blackmon, and Michael Vick.

For Hernandez, doing some sort of damage control at this point is going to be very difficult, and might not be worth it at all. But what kind of message does this send to his avid followers? There are a ton of Patriots fans who have children who aspire to be like Hernandez. What would he say to them during this time? Before any of this happened, Hernandez was considered one of the most “fan favored” on the team, with his merchandise being some of the top selling for the team, along with Tom Brady and Wes Welker.

The role of the media could do more damage to the team. If the Patriots don’t lay down the law before training camp and tell the media not to ask questions about the Hernandez case, it could become troublesome. Bill Belichick, head coach for the Patriots, will have no trouble shutting the media down who have questions about the case, and the media knows this. However, the media also knows that players who are close to Hernandez could be more open to talk. The issue with this is that talking more and more about the case with players could take their focus off football and game day outcomes, and their hopes of being Super Bowl Champions again.

Shortly after the release of Hernandez, the Patriots started taking merchandise with his name on it off their website. The NFL Shop, and Football Fanatics did the same. What’s more interesting is all three outlets still sell Wes Welker merchandise even though he is now playing with the Denver Broncos. Though the situations aren’t the same, there is a market for Hernandez merchandise. That market is fans of the Patriots who want to support Hernandez throughout the trial and don’t have anything that’s specific to him.

The underlying factor of any sports team is to make money, and they are a business. Last summer (2012) Hernandez signed a five-year contract with the Patriots for $40 million including a $12.5 million signing bonus. He earned $9.79 million of the extension based solely on a base salary and bonus money in 2012. For the 2013 season, the salary cap charge is just over $5 million, and 2014 is going to be $7.5 million. The $7.5 million is the remaining amount on his signing bonus. Because the Patriots released Hernandez in this way, they do not have to continue to pay him the contract money outside of his signing bonus, but he will be paid his bonus and the Patriots will not try to get it back.

Either way the Patriots will still come out on top. If Hernandez is found not guilty, they can sign him back, though that would be really bad pr and marketing for the team. If Hernandez is found guilty, the Patriots are still below the salary cap for the league because they aren’t having to pay him anything but the remainder of his signing bonus. Since Tom Brady took a salary cut this season to create more cap space, the Patriots have room to sign a new tight end, bring in more rookies, or start to prepare the way for the next Tom Brady-style quarterback for their team.

The next step for the team will be to find a new star at the tight end position then prepare for the 2013 NFL season. As for Hernandez, we will have to wait and see the outcome on that.